Question & AnswerQ&A (Republic Act No. 9224)
RA 9224 rationalizes the excise tax on automobiles by amending Section 149 of the National Internal Revenue Code of 1997, establishing a new ad valorem tax schedule based on the manufacturer's or importer's selling price, net of excise and VAT.
The tax is an ad valorem tax based on the net manufacturer’s or importer’s selling price with graduated rates: 2% up to P600,000; P12,000 plus 20% on the excess over P600,000 up to P1.1 million; P112,000 plus 40% on the excess over P1.1 million up to P2.1 million; and P512,000 plus 60% on the excess over P2.1 million.
Buses, trucks, cargo vans, jeeps/jeepneys/jeepney substitutes, single cab chassis, and special-purpose vehicles are excluded and thus not subject to the excise tax under this law.
'Automobile' means any four or more wheeled motor vehicle regardless of seating capacity, propelled by gasoline, diesel, electricity or other motive power, excluding those specifically defined as bus, truck, jeepney, single cab chassis, and special-purpose vehicles.
The Secretary of Finance may adjust the tax brackets every two years if the Philippine Peso changes more than 10% against the US dollar from the act's effectivity or last adjustment, with full adjustment at 20% or more depreciation/appreciation anytime in that period.
For imported automobiles not for sale, the excise tax is based on the total landed value which includes transaction value, customs duties, and all other charges.
No, automobiles used exclusively within freeport zones are exempt from excise tax according to RA 9224.
The Secretary of Finance, upon recommendation of the Commissioner of Internal Revenue, is mandated to promulgate the necessary rules and regulations within 30 days from the Act's approval.
The separability clause provides that if any provision is held unconstitutional or invalid, all other provisions not affected shall remain valid and enforceable.
The Act takes effect fifteen days after the publication of its approved implementing rules and regulations, following its approval on August 29, 2003.